India and the European Union (EU) have held the first high level dialogue (HLD) and discussed ways to promote bilateral trade and investments, the commerce ministry said on Saturday.
The meeting was co-chaired by Minister of Commerce and Industry Piyush Goyal and the European Union Executive Vice-President and Trade Commissioner Valdis Dombrovskis. It was held on Friday.
During the discussions, the ministers “agreed for further deepening of bilateral trade and investment relationship through a series of regular engagements, aiming at quick deliverable for the businesses in these tough times”, it said.
The ministers also agreed to meet within the next three months, with an objective for reaching consensus on a host of bilateral trade and investment cooperation issues including a bilateral Regulatory Dialogue
Source: The Financial Express
The Union Budget 2021-22 has introduced several measures to provide an impetus to growth, and the projected increase in capital expenditure augurs well for capacity creation thereby improving the prospects for growth and building credibility around the quality of expenditure, the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) has said.
"The recovery, however, is still to gather firm traction and hence continued policy support is crucial. Taking these developments into consideration, the MPC in its meeting today decided to continue with an accommodative stance of monetary policy till the prospects of a sustained recovery are well secured while closely monitoring the evolving outlook for inflation," the MPC said in its Monetary Policy Statement.
On the basis of an assessment of the current and evolving macroeconomic situation, the MPC decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent.
Consequently, the reverse repo rate under the LAF would remain unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.
The MPC also decided to continue with the accommodative stance as long as necessary – at least during the current financial year and into the next financial year – to revive growth on a durable basis and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.
"These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth," the statement said.
On the outlook for the Indian economy, MPC said that the Union Budget 2021-22, with its thrust on sectors such as health and well-being, infrastructure, innovation and research, among others, should help accelerate the growth momentum.
Taking these factors into consideration, real GDP growth is projected at 10.5 per cent in 2021-22 – in the range of 26.2 to 8.3 per cent in H1 and 6.0 per cent in Q3.
Source: Fibre2Fashion
Finance Minister Nirmala Sitharaman on Sunday said the government will work with the Reserve Bank for execution of the bank privatisation plan announced in the budget.
Speaking to reporters in the financial capital, Sitharaman also said that the government has no plan to form any bank investment company to house the government stakes in banks.
In the union budget presented last week, Sitharaman had announced the privatisation of two banks as part of its disinvestment plan. Bank unions have opposed the move.
"The details are being worked out. I have made the announcement but we are working together with the RBI," she said, when asked about the proposal.
She, however, declined to comment on any specific details about which will be the candidate chosen for privatisation.
"We will let you know when the government is ready to announce," she answered when asked about the details.
On the bad bank, Sitharaman said thegovernment may have to give some guarantee for the National Asset Reconstruction Company (ARC), but stressed that this is a solution which has come from the banks itself and will also be led by them.
Sitharaman alleged that the banks' non-performing assets, which are to be transferred into the National ARC, are a legacy of the mismanagement in the past.
There is no phone banking happening now, with favours being sought for anyone from New Delhi.
On the Bank Investment Company (BIC), she said no such proposal is on the table and wondered what resulted in the discussion.
"There is no such discussion. I don't know where it is coming from. At least it is not before me. I am not discussing that, she said.
She said that there is a need for professionalisation of banks and the government is trying to ensure the same.
The minister also said that the banks are gradually getting out of the risk aversion, which had set in during the early days of the pandemic.
When asked about the ambitious divestment targets and the government's ability to push through necessary reforms to earn the projected revenues, Sitharaman exuded confidence of hitting budgetary estimates of Rs 1.75 lakh crore divestment.
Sitharaman said the government stands to get up to Rs 30,000 crore from the newly introduced agricultural infrastructure cess.
On the issue of fuel prices, and inflation there in because of the duties, Sitharaman said if the Centre lowers excise, states will increase their taxes to keep the prices at the same level and also earn some revenues.
Source: The Business Standard
Progress of physical infrastructure, upgrading of the business environment and labor productivity and technical implementation are crucial in making Bangladesh viable in international trade by counterweighing the developing country (DC) graduation from least developed countries (LDC).
In this regard, the General Economics Division (GED) said in a study report, “Better infrastructure and labor productivity will lessen the costs and smoothen the business in the post-LDC period.”
The arm of the Planning Ministry did the study named ‘Impact assessment and coping up strategies of graduation from LDC status for Bangladesh’ as Bangladesh is poised to graduate from the group of the LDC in 2024.
The study emphasized that although the government must be praised for growing the number of power plants to 108 in 2020 from 27 in 2009, most of them are in a minor scale.
Keeping in mind the increase of likely demand for electricity to 34,000 MW by 2030, the govt. is planning to invest around US$70 billion in the power sector over the coming 15 years.
|
Time needed to get electricity Source: World Bank; doing business 2019 |
|
|
Country |
Time (in days) |
|
Bangladesh |
150.2 |
|
India |
55 |
|
Indonesia |
34 |
|
Malaysia |
24 |
|
Myanmar |
77 |
|
Nepal |
70 |
|
Philippines |
37 |
|
Singapore |
30 |
|
Thailand |
30 |
|
Vietnam |
31 |
It is of utmost vital that this investment is built on using low-cost options and renewable energy to the degree of technically conceivable to cut the cost of electricity, safeguard the sustainability of primary energy supply and cut carbon pollution. Suitable pricing of primary energy will be of serious importance.
Besides, importance will also have to be given to power transmission and distribution, upgrading of grid capacities, and energy trade in the wider area.
The GED report highlighted the present road network was insufficient to deliver infrastructural support to a country with a people of more than 160 million and that is ambitious to become a high-income country in 2041.
In international connectivity, Bangladesh is given a score of 34.3 out of 100 and a ranking of 121th out of 140 countries. The quality of roads is also measured to be below average, with a score of 3.1 out of 7 and a rank of 111th out of 140.
Meaning the export competitiveness can be badly affected by the high cost of business, equally for imports of raw materials and capital goods and exports of products.”
The status of effective, low-cost trade logistics is now well-recognized as a vital factor of export competitiveness.
Bangladesh is ranked 100 out of 160 countries in the Index of Trade Logistics Performance (LPI) of the WB, much behind China, Thailand, India and Vietnam.
The report said, China, Vietnam and India are the main competitors of Bangladesh for readymade garments (RMG) in the European Union, and the higher cost of trade logistics may have grave opposing costs for maintaining market share post-LDC graduation.
When Bangladesh graduates from the LDC group, surely the competitiveness challenge will deepen. And to preserve the market share in the more competitive environment, it will be significant for companies to have timely and less costly access to raw materials, uphold production schedules and ship products to their buyers on time.
Vessel turnaround time and cargo clearance from container yards at the Chattogram port, which handles 75% of Bangladesh’s US$90-billion international trade, are longer than the most ports in the region. Reforms should be done to improve the efficiency of the Mongla port.
Moreover, after holding dialogue with all shareholders, decisions should be taken as to whether some of the handling operations in the ports of Chittagong and Mongla should be contracted out to private entities, the report said.
Despite progress with the policy environment for the private sector that has spurred the expansion of private investment from a low of 6 percent of GDP in the fiscal year of 1988-89 to 23 percent of GDP in FY2018, the overall investment climate for Bangladesh remains substantially weaker than those found in competing countries.
This is echoed in the international rankings of investment climate prepared by the WB as well as by the World Economic Forum. The WB 2020 Ease of Doing Business ranks Bangladesh 168th out of 190 countries.
Bangladesh has taken some constructive steps to address the serviced land restraint through industrial parks and special economic zones.
“This is a welcome move. Speedy completion of all ongoing facilities and making them available in a timely and business-friendly way will be an important factor to spur domestic and foreign investment,” the GED report said.
“Bangladesh should focus on reducing the time it takes to get electricity, register property, obtain credit, trade across borders, enforce contracts and resolve insolvencies.”
Export expansion and diversification are often constrained by limited domestic capital, technology and market knowledge.
The foreign direct investment (FDI) with their better technological and managerial skills and knowledge about international marketing conditions is expected to improve the productivity and export performance of host country firms.
It has been claimed that Bangladesh needs to get on the bandwagon of the global value chain (GVC) as a means to export-oriented industrialization.
Cross-border FDI flows have been the lifeline for the growth of GVC trade that helps sustain the growing production networks across borders.
Bangladesh’s record in mobilizing FDI is disappointing, the GED said.
FDI in Bangladesh reached $2.2 billion in 2017, as compared with $134 billion in China, $40 billion in India and $14 billion in Vietnam.
At present, Bangladesh faces the dual challenge of mobilizing more FDI and integrating it into the GVC operation.
Its greatest chance of receiving on the GVC bandwagon lies in aggressively courting FDI from conglomerates that are seeking low-cost places for producing parts and components or for final assembly within the outline of cross-border production integration.
FDI thus becomes critical for Bangladesh not only to develop a wider base of intermediate goods industry but also to diversify exports into intermediate goods by vertically integrating with cross-border production entities.
Bangladesh needs to transform its RMG experience with GVC on to other areas such as footwear and leather goods, electronics, light engineering, toys, and plastics with an aggressive strategy of FDI-driven GVC over the sequence of the next decade.
Bangladesh is plentifully gifted with low-cost labor that delivers the basis for qualified benefits in producing and exporting labor-intensive products.
Certainly, the RMG upheaval is a major example of how Bangladesh has grown global market share based on low labor costs. Yet, it is also known that labor productivity in Bangladesh is very low.
The report pointed that a key challenge in the post-graduation world for Bangladesh would be to raise labor productivity through big investments in human capital and other policy changes. This possibly holds the crucial to successful graduation from LDC status.
Utilizing land, employing labor and investing capital away from agriculture to industry is not sufficient if the labor force is not trained and productive.
Bangladesh has made significant inroads in enlightening human capital as suggested by promising human development pointers relative to comparators at the same level of development.
The superiority of the labor force in terms of skills is also low on average though the government started the National Skills Development Policy to increase the capabilities through spreading the extent of technical and vocational education and training.
Constructing on the development achieved in basic education and consolidation of other levels of education, including vocational and higher education are important to have a well-educated and skilled population with the capacity to contribute effectively to the country’s development.
Source: Textile Today
A new e-commerce policy that is being worked out will cover various crucial issues, ranging from data protection to consumer rights, and a regulator for the sector may be set up, if required, department for the promotion of industry and internal trade (DPIIT) secretary Guruprasad Mohapatra said on Friday.
It will also cover areas, including the issue of counterfeit products sold via online platforms and packaging and rules of origin, Mohapatra told reporters.
Commenting on the broad spectrum that will be covered under the new e-commerce policy, Mohapatra said: “Who should be accountable for counterfeit products sold through an e-commerce company? Data is an important issue.
The entire data issue will be governed by what actually the data law will be, which is before Parliament.” “That is why we are not in a hurry to finalise it (the policy)… So, whatever will be the final outcome of that data bill, it will apply to everybody who will deal with data.”
He said that e-commerce is not just about foreign direct investment (FDI) in it; it covers a large spectrum of issues.
In February 2019, the government had released a draft e-commerce policy that had provided for regulating cross-border data flows, setting up storage facilities locally and establishing a ‘data authority’ to devise a framework for sharing community data.
Asserting that the country and its citizens had a “sovereign right” over data, the policy had disallowed sensitive data collected and processed locally but stored abroad from being shared with foreign governments and businesses outside India or any such third party even with the consent of the customer.
The draft policy had also proposed to grant companies three years to set up storage. It also sought a review of the extant policy of exempting electronic transmission from customs duty “in the light of the changing digital economy and the increased role that additive manufacturing is expected to take”.
Subsequently, the government sought to revise the draft. FE had in December reported that, according to the new darft policy that is being firmed up, the government may set up an investigation body to “holistically inquire” into the violation of various laws by e-commerce entities and initiate action.
Any such move will likely spell trouble for players like Amazon and Flipkart that are often accused by brick-and-mortar players of resorting to predatory pricing by offering discounts clandestinely through the sellers on their platforms, in violation of the FDI rules. The e-commerce players, however, have denied the charges.
Source: The Financial Express
The North-East Region (NER) of India has the highest concentration of handloom weavers in the country with women participation of around 88 per cent.
The Union Minister of Textiles Smriti Irani shared this information in Lok Sabha (lower house) today.
NER comprises eight states – Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura.
As far as Government support to the handloom weavers for NCT is concerned, there are few interesting initiatives also.
There are 38 such Urban Haats sanctioned across the country so far, out of which 3 have been sanctioned in NER States.
These Urban Haats have been set up in big towns/metropolitan cities to provide adequate direct marketing facilities to the craft persons/weavers and eliminate middle agencies.
In Assam, which is one of the leading NER States, Sivasagar Mega Handloom cluster has been taken up covering Sivasagar district.
Yarn Supply Scheme is being implemented throughout the country (including NER States) to make available all types of yarn at Mill Gate Price.
From 2017-18 to 2019-20 and in the current financial year, 11.49 lakh kg yarn of the value of Rs. 7,199 lakh has been supplied under the scheme in NER states.
The North-East Region Textile Promotion Scheme (NERTPS) is an umbrella scheme implemented in project mode to promote textiles industry in the NER States by providing infrastructure, capacity building and marketing support to the industry.
India Handloom brand, which has total 1,590 registrations, has 14 registrations from NER States.
Source: Apparel Online
Source: The Financial Express
Despite worries on inflation, Reserve Bank of India (RBI) on Friday opted to leave policy rates unchanged even as it promised an accommodative stance for rates and, critically, liquidity. “The RBI stands committed to ensure the availability of ample liquidity in the system…As the government’s debt manager and banker, the Reserve Bank will ensure the orderly completion of the market borrowing programme in a non-disruptive manner,” RBI governor Shaktikanta Das observed. The central bank expects the economy to grow at 10.5% in 2021-22.
However, despite assurances from the central bank it would ensure the government’s large borrowing plan of Rs 12 lakh crore went through smoothly, the bond markets remained somewhat nervous with yields trending up.
Experts noted interest rates are headed up and that the trading range for the benchmark which has been ruling at 5.75-6% is expected to shift upwards. Moreover, the quantum of surplus liquidity could be smaller in 2021-22.
“The cost of capital for companies is going to go up,” bankers said.
Pranjul Bhandari, chief economist, HSBC, believes the aim of the central bank will be to ensure that financial conditions do not tighten too sharply over the foreseeable future.
Economists believe the policy repo rate will stay unchanged through 2021 and rise as growth picks up. “We expect the policy stance to shift to ‘neutral’ from ‘accommodative’ in Q3, the normalisation of the policy corridor to begin in Q4, and 50 bps worth of repo rate hikes in H1 2022,” Sonal Varma, chief economist at Nomura, wrote.
Source: The Financial Express
India's imposition of 10 percent duty on cotton imports is unlikely to dent buying, the head of the Cotton Association of India (CAI) told Reuters.
The 10 percent import duty imposed by the world's biggest cotton producer was announced by Finance Minister Nirmala Sitharaman in her budget speech to parliament on Monday.
"There won't be any impact on imports. The textile industry needs extra long staple cotton," said CAI's president, Atul Ganatra, adding that this type of cotton is in short supply on the domestic market.
Indian textile mills have already imported 600,000 bales of cotton in the 2020/21 marketing year that started on Oct. 1, with a further 800,000 bales likely to be sourced from outside the country during the rest of the season, Ganatra said.
The country is expected to produce 36 million bales in the current marketing year, against local demand of 33 million bales, though supply of extra long staple cotton is negligible, the CAI says.
India imports long staple cotton mainly from Egypt and United States. It exports surplus cotton to Bangladesh, Vietnam and China.
Basic customs duty on man-made fibres (MMF) such as caprolactam, nylon chips and nylon fibre and yarn were cut to 5 percent from 7.5 percent in the budget.
India is a net importer of these products and the reduction would make the MMF industry more competitive globally, said Ashok Juneja, president of India's Textile Association.
Source: Money Control
Following the announcement of import duty on cotton in the Union budget, the sale of cotton in local market witnessed a drastic rise touching a high of Rs 66 per kilogram. The total sale crossed Rs 6 crore in Tiruchy.
Agriculture Department officials said that following a bumper crop this harvest season, many farmers are preparing their field to raise cotton crop once again. Farmers would generally shift between raising maize and cotton crop. However, owing to drop in the price of maize, many of them had shifted to raising cotton. According to the department, the market value of cotton witnessed a gradual rise from the previous years' figure at the Thuraiyur regulatory market.
Speaking to TNIE, Sugumar, secretary of the marketing committee of the department said, "Despite rainfall during the harvest of cotton, the price seems to be gradually increasing. However, with the import duty of cotton increasing by 10 per cent in the budget, the cotton price reached a record high of Rs 63 - Rs 66 per kg at the auction this week."
Sugumar said the increase in import duty would give an edge to cotton farmers, and help them keep the price well above Rs 60 per kg for sometime. Last year, cotton auction earned a total of Rs 9 crore throughout the season at the Thuraiyur regulatory market. This year's auction already crossed `6 crore till this week and considering the phase of sale, the value is likely to cross the previous year records.
An official said that with the cotton harvest nearing completion, farmers are expected to raise pulses till the next cultivation season. During May and June, more farmers are likely to shift from maize to cotton. As maize cultivation failed this season and the with the cotton market getting stabilised, cotton would be a prime choice for farmers, said official.
Source: The New Indian Express
The FM has unravelled a most consequential and pathbreaking Budget, which rightly catalyses growth with social inclusion; and has struck a delicate balance between lives and livelihood, growth and fiscal prudence.
A significant push to public investment, on both physical and social infrastructure, has been the leitmotif. The NIP—launched with 6,835 projects—has now expanded to 7,400 projects with a capital allocation of Rs 5.54 lakh crore in FY22(BE) against Rs 4.39 lakh crore in FY21 (RE). This will help speed up infrastructure development, create demand and shore up growth, and create much-needed jobs.
Another stand-out feature is the higher allocation to healthcare, particularly for Covid-19 vaccine. The pandemic has brought to the fore the fragile nature of public health infrastructure.
The govt has also addressed the pertinent issue of infrastructure financing. DFI is a welcome move for strengthening the financing portfolio for infrastructure and would help in channelise investments. Further, the “National Monetization Pipeline” of potential brownfield infrastructure assets is proposed to be launched.
The monetising of existing assets through this channel will help generate additional resources which could be ploughed back into infrastructure.
Cognisant of the financial sector’s role, the government has announced a plethora of measures pertaining to banking, insurance, and the bond market. The setting up of a bad bank, in the form of asset reconstruction & management company, will help banks recycle their bad loans.
Similarly, the increase in FDI in the insurance sector from 49% to 74%, bringing down the government stake in two PSBs, enabling debt financing of InVITs and REITs by FPIs, et al, are all moves in the right direction.
The Budget has retained an agrarian and rural pivot. A comprehensive set of measures to reduce the supply-side bottlenecks in delivery and distribution have been announced. The Budget FY22 focusses on creating an efficient agriculture marketing ecosystem, bridging the infrastructure gaps, reducing wastages across the supply chain, enhancing domestic competitiveness, creating high-value segments and nutrition.
Coming to specifics, the planned investment in agri-infra, by enhancing the allocation to the rural infra development fund and micro-irrigation fund is significant. Similarly, the Budget has rightly enhanced the target for credit to agriculture to Rs 16.5 lakh crore in FY22. And the extension of e-Nam to 1,000 more a would also help in price discovery for farmers. Another key feature is a gradual shift towards green and sustainable development—Rs 2,217 crore has been allocated for 42 urban centres with a million-plus population to address air pollution issues.
The expansion of metro network and augmenting public transport would help decongest roads, boost urban mobility and promote decongestion and pollution.
The provision of water supply to urban households through the JJM (urban) in all 4,378 Urban Local Bodies with 2.86 crore household tap connections, as well as liquid waste management in 500 AMRUT cities over five years, is noteworthy.
To bring this programme under the key component of infrastructure and accordingly awarding water supply and sewage work contracts would improve the living conditions.
Source: The Financial Express
India plans to bring down defence imports by $2 billion by the end of 2022, announced the Union Defence Minister Rajnath Singh at the Aero India 2021’s Bandhan – partnership signing ceremony.
He said, the idea of cutting down on imports is to encourage domestic manufacture of defence related items. Between 2016 and 2019, 138 proposals worth over $37 billion have been approved for domestic manufacturing and they will pay off now in lower imports.
At Aero India, 128 MoUs were signed, 19 technology transfers (ToTs) finalised, four handing overs, 18 product launches and 32 major announcements were made, in all totalling over 200 proposals.
Singh said, “We realise, appreciate and understand that in a highly specialised and technology driven environment, a collaborative, cooperative and collective approach to defence production and exports is the way forward.”
The Defence Minister further said a large number of initiatives have been taken to facilitate the partnership of major companies from across the world and to become a part of India’s defence industry initiative. It is with this objective that FDI was raised to 74 per cent from 49 per cent in August 2020.
The fountain head of any capability emerges from the robustness of its foundation. And the foundation of our vision rests on three pillars. These are Research and Development, Public and Private Defence Production and Defence Exports, said Singh.
“A robust domestic manufacturing base relates directly to the potential for defence exports. We plan to move from a $11 billion defence base to $25 billion by 2025. Of this, we further intend to create an export component of $5 billion,” he said.
“I am happy to inform the audience that during the period 2015-2020, defence exports grew from ₹2,000 crore to ₹9,000 crore. It is also important to note that a vast majority of our defence exports are being spearheaded by the private sector,” he added.
Talking about the aerospace sector, Rajnath Singh said, “The sector has an important role to play, if we have to reach our targets of domestic defence production of $25 billion and exports of $5 billion by 2025.”
“The Indian aerospace industry, both military and civil, stands uniquely poised today, on the threshold of catapulting itself into the global arena. The aero components sector is set to grow from ₹30,000 crore today to ₹60,000 crore by 2024,” he added.
Source: The Hindu Business Line
While the European Union pushed for early harvest trade and investment deal with India at the maiden high-level dialogue (HLD) held last Friday, UK’s secretary of state for international trade Liz Truss’s ongoing visit here is aimed at kick-starting a mega trade deal with India in the post-Brexit period.
India and the EU have decided to focus on complementarities including sustainable development, green technologies, transparent regimes and resilient supply chains to boost their economic partnership, said people aware of the matter.
Europe will be a key focus for India in 2021 as Prime Minister Narendra Modi is planning four trips to the continent, beginning with the EU Summit in May in Lisbon. The PM will visit the UK for the G-7 summit in June,
followed by the G-20 Summit in Italy at October-end and COP-26 in November in the UK, said the people.
Ahead of PM Modi's trips, they said, several foreign ministers from Europe are expected to be present at the
Raisina Dialogue, India's premier foreign policy dialogue, to be held mid-April.
The first HLD with the EU was co-chaired by the commerce and industry minister Piyush Goyal and the European Union executive vice-president and trade commissioner Valdis Dombrovskis.
Commitment to the establishment of the HLD was a major outcome of the 15th India-EU Leaders' Summit held in July 2020. During the discussions in the HLD, the ministers emphasised the importance of global cooperation and solidarity in a post-Covid-19 era and agreed for further deepening of bilateral trade and investment relationship through a series of regular engagements, aiming at quick deliverables for businesses in these tough times, said officials.
The ministers also agreed to meet within the next three months, with an objective for reaching consensus on a host of bilateral trade and investment cooperation issues such as a bilateral regulatory dialogue and an India-EU multilateral dialogue to explore further possibilities of cooperation.
In a significant step forward, regular interactions for re-initiation of bilateral trade and investment agreements, with an interim agreement to start with, were also discussed, said officials.
Negotiations for India-EU Bilateral Trade and Investment Agreement, launched in 2007, were suspended in 2014 following differences over market access for key items such as automobiles, wines and spirits, dairy and also the movement of professionals. Subsequent attempts to restart the talks failed as the EU wanted labour, environment and government procurement issues also to be part of the pact.
Meanwhile, Britain is hoping to seal a bumper trade deal with India.
A trade deal with India could be as high as £50-100 billion, given India was the second largest source of
foreign direct investment for the UK and the UK has been among the top six investors in India. ET has learnt that Truss, who had been in communication with Goyal ahead of her visit, discussed an early harvest deal with India. The aim is to conclude this at the earliest,
said the people cited earlier.
Truss met the commerce and industry minister on Saturday, and her trip follows foreign secretary Dominic Raab’s visit in December. Raab had said at the time, “I think we have been too myopically focused just on Europe.
But one of the advantages of leaving the transition period is we gain control over our ability to strike trade deals with India and the rest of the word. And, certainly, if you look at India and the Indo-Pacific and take a long-term view, that is where the growth opportunity of the future will be.”
Prime Minister Boris Johnson was set to be the chief guest at India’s Republic Day celebrations on January 26, but he was forced to cancel his trip due to the imposition of fresh restrictions in the UK on account of Covid-19. He is planning to visit India in the near future.
Source: The Economic Times
The government will roll out on April 1 a proposed production-linked incentive (PLI) scheme for white goods, under which eligible investors in air-conditioners and LED lights will be granted incentives worth Rs 6,238 crore over five years.
The expenditure finance committee last week cleared the proposal of the department for promotion of industry and internal trade (DPIIT). It will now be placed before the Cabinet for final clearance.
Potential investors will have at least six months after the scheme’s launch to apply for it and submit plans, DPIIT secretary Guruprasad Mohapatra said on Friday.
Under the scheme, eligible investors are now proposed to get incentives of 4-6% on incremental sales (to be calculated over the base year of 2019-20) of goods manufactured in India for a period of five years.
Of course, the benefits will be subject to certain conditions, including on the threshold of cumulative incremental investments.
“PLI is a game-changer scheme. It will promote global champions in India,” Mohapatra told reporters.
The PLI scheme for white goods, which is being spearheaded by the DPIIT, was one of the 13 such schemes announced by the government in the wake of the Covid-19 pandemic last year. The idea was to lure mainly large companies to ramp up manufacturing base and boost exports.
The total incentives under the PLI schemes, covering sectors including telecom, electronics, auto part, pharma, chemical cells and textiles, stood at `1.97 lakh crore over a five-year period. Various departments are firming up proposals relative to the sectors they oversee.
The DPIIT expects the incentive to result in incremental production of ACs and LED lights worth Rs 1,68,000 crore over five years. It will likely lead to additional exports of Rs 64,400 crore, extra direct tax collection of Rs 11,300 crore and GST mop-up of Rs 38,000 crore over five years.
Stressing the potential of various PLI schemes and the surge of interest of global investors in India, Mohapatra said, “We are actively monitoring more than 1,000 companies in the world which are either already in India and thinking of expanding or thinking of entering India. We are carefully and closely monitoring their discussions.”
Source: The Financial Express
Rating agency Moody’s Investor Service recently projected India’s nominal growth at 17 per cent for the coming fiscal, up from the earlier 14.3 per cent based on the ‘pro-growth’ budget, but highlighted weak prospects of fiscal consolidation.
“The budget's focus on higher capital expenditure, financial sector reforms and asset sales will help to stimulate growth and supply broad-based credit support,” it said in a report.
The larger-than-expected deficit projections reflected both credible budgetary assumptions and greater transparency, but the government's weak fiscal position is likely to remain a key credit challenge, Moody’s said.
The latest budget forecast nominal gross domestic product (GDP) growth at 14.4 per cent.
The agency had pegged India’s fiscal deficit for the current fiscal at 7.5 per cent of GDP and 5.5 per cent for the next fisscal, while the budget put the figures at 9.5 per cent and 6.8 per cent for 2020-21 and 2021-22 respectively.
“However, compared with previous budgets, the gap between our forecasts and the government's, largely reects increased transparency on subsidy spending and more credible overall assumptions,” the report said, adding that it expects the nal gure to be lower based on stronger revenue generation during the fourth quarter of 2020-21.
In terms of the consolidation roadmap, without providing the explicit path, the targeted deficit of 4.5 per cent by 2025-26 implied an average annual deficit reduction of about 0.5 per cent of GDP over four years.
Combined with the expected rise in debt burden to over 90 per cent in the ongoing fiscal, the “gradual pace of consolidation will prevent any material strengthening in the government's scal position over the medium term,” Moody’s said.
The agency counted the opening up of the insurance sector to 74 per cent foreign direct investment from 49 per cent as a credit positive and said achieving the disinvestment target of ₹1.75 lakh crore would be key to achieving other budget targets.
Source: Fibre2Fashion News
Nexia & De Franceschi is an Italian group, leader for the production of excellent washing and dyeing industrial machines of garment finishing since 1871, point of reference for industrial laundries, major industries, hospitals, hotels and textile industry.
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OZONE, wet and dry process, ozone processing exploits ozone in synergy with water as bleacher and powerful sanitizer.
NEXSTONE, Stone free abrasion, an exclusive and unique patented system whereby textiles are washed without the use of pumice stone, Nexstone also allows for the reduction of waste emissions as well as limiting water consumption.
NDROP DOUBLE FRONT AND REAR NEBULIZER, it increases load capacity and simultaneously reduces water consumption per garment by at least 85% (in relation to latest market technology).
The All Together System puts these treatments into one High-speed extractor Nexia NS420, a washing system complete with spin cycle. This allows for the rinsing of garments between one treatment and the next, and with just one load/unload only. The wash cycle is therefore uninterrupted leading to a more fluid and dynamic process with better results.
Altogether, the laundry smart evolution!
There is no improvisation when it comes to our products! There are no casual choices! There is only constant research in our engineering laboratories together with solid experience in the denim industry. In this, Nexia is a 100% guarantee, Made in Italy.
Source: Apparel Online
The government is confident of lowering the fiscal deficit to 4.5 per cent of GDP by 2025-26 fiscal, considering a nominal GDP growth of 10 per cent every year, Expenditure Secretary T V Somanathan has said.
India has exceeded its fiscal deficit target of 3.5 per cent in the current fiscal by a wide margin due to higher spendings to stimulate the economy amid the pandemic. The fiscal deficit — the excess of government expenditure over its revenues has been pegged at 9.5 per cent of the gross domestic product (GDP) in the current fiscal ending March 31, as per the revised estimate.
For the next 2021-22 fiscal, the deficit has been pegged at 6.8 per cent of GDP, which will be further lowered to 4.5 per cent by the fiscal ending March 31, 2026.
“We are very serious about bringing it (deficit) down. 9.5 per cent to 6.8 per cent is very much achievable and after that if you look at 10 per cent (nominal) growth per annum, if you look at a tax buoyancy of 1.1 per cent and if you look at the fact that such extraordinary expenses will not be there in the future years, every year cannot be a COVID year, I think we are very confident of reaching below 4.5 per cent,” Somanathan told PTI.
He said the fiscal deficit target has been set keeping in mind the estimate of a 5-6 per cent real GDP growth over next four years, while nominal GDP will be at least 44 per cent higher than what it is today. “Let us assume (real GDP) growth to be 5-6 per cent, and inflation at 4-5 per cent, we will get to 10 per cent (nominal growth).
Most likely we will get to 11 per cent (nominal growth). So 44 per cent growth in GDP denominator is almost certain. So on that GDP our deficit will be 4.5 per cent. I think we are quite confident we will reach it,” he said.
In its post budget commentary, S&P Global Ratings had said India’s budget for the next fiscal is an effort of the government to shore up economic recovery, but fiscal consolidation would pose a stout challenge to policymakers going forward.
“The prospect of consolidation from these heights, while maintaining a significant degree of support for the economy, poses a stout challenge to India’s policymakers,” S&P had said.
Source: The Financial Express
India disagrees with the United States Trade Representative (USTR) report that the country's 2 per cent equalisation levy on foreign e-commerce firms discriminates against US firms, according to Indian commerce secretary Anup Wadhawan, who recently said some countries are protesting as they have huge domination in that kind of activity whether it is Facebook or Google or Amazon.
"We do not agree with that conclusion," he was quoted as saying by a news agency.
Last month, an USTR investigation concluded that India's 2 per cent digital services tax on e-commerce supply discriminates against US companies and is inconsistent with international tax principles.
"Basically, if there is an economic benefit from a certain jurisdiction then there has to be some taxation in that jurisdiction...OECD [Organisation for Economic Co-operation and Development] is also moving in that direction that if you have an economic presence and economic gain, then you must have taxation in that jurisdiction. You have billions of dollars of revenue in a certain jurisdiction, you have to pay taxes," he added.
Source: Fibre2Fashion News
Calibrated stimulus measures in the wake of the Covid-19 pandemic and a sharp hike in capex in the Budget for FY22reflect the government’s economic strategy of rebuilding battered demand while ensuring that the supply side is expanded enough to move in tandem, principal economic advisor Sanjeev Sanyal told FE.
Moving in that direction, the government is committed to high capital expenditure not just in FY22 but over the next three years, Sanyal said in an interview, seeking to allay fears that the latest capex boost may be a Covid-induced one-off event.
The government has budgeted capital expenditure at Rs 5.45 lakh crore for FY22, which is 26.2% higher than the RE of FY21 and 34.5% larger than the budget estimate (BE) for this fiscal. In contrast, at Rs 29.3 lakh crore, the BE of revenue expenditure for FY22 is 3% lower than the revised estimate for this fiscal and 11.4% higher than the BE of FY21.
“There are two important aspects here. First, the government has kept in mind that its interventions should be calibrated in such a manner that they don’t flare up inflation. Second, since some debt is going to be accumulated in this process, we leave behind some assets for future generation,” Sanyal said.
The first set of relief package, including free grains and dole-out for women Jan Dhan beneficiaries, was taken purely to protect the poor and the vulnerable. But the real demand-side measures were announced when the lockdown was relaxed and supply-side disruptions eased, Sanyal said. “Otherwise, it would be like you are pressing the accelerator when the brakes have been applied.”
Consequently, the capex reversed a 12% drop on year up to September this fiscal to actually rise as much as 21 % by December.
Already, both the government and the central bank had rolled out supply-side steps (guaranteed loans for both MSMEs and relatively large entities, and professionals, liquidity-boosting steps, among others) to match with demand-side stimulus, he said. Now, the enhanced capex, with its focus on infrastructure, will also add to the productive capacity of the economy, apart from spurring demand.
Asked about the need for a development finance institution, as proposed in the Budget, Sanyal said it would be a specialised agency for rapid infrastructure creation and will go beyond funding projects. Banks, barring the top ones, don’t really have specialised units to cater for the entire spectrum of infrastructure financing.
So, the DFI would come in handy. Also, more private-sector DFIs will come up as a result of the government creating an enabling set-up with relevant laws.
Explaining the difference between the role of the NIIF and the DFI when both are aimed at helping infrastructure creation, Sanyal said, in common parlance, the quasi-sovereign wealth fund is more equity-focussed while the DFI would be more debt-focussed.
The Budget has proposed a capital infusion of `20, 000 crore into the DFI. Using this, it will likely raise resources up to Rs 5 lakh crore over the next few years and help finance infrastructure projects, apart from creating an entire eco-system around it.
The National Bank for Financing Infrastructure and Development, as the DFI will be known, is expected to play a catalytic role in financing projects under the Rs 111 lakh crore National Infrastructure Pipeline. Ultimately, it will also contribute towards deepening the country’s corporate bond market for infrastructure financing.
Source: The Financial Express
Seed to Style has launched its affordable and authentic sustainable fashion collection exclusively with leading multi-platform ecommerce retailer, QVC, to inspire and activate today’s more conscious consumer. Seed to Style is owned by Ecofashion, a ‘Greenhouse of Brands’, founded by Ecolifestyle pioneer, innovator, expert, and author, Marci Zaroff.
Seed to Style’s products start at the source; cultivating non-GMO seeds, free of harmful toxic inputs, for a truly regenerative future, offering high quality, super soft, and accessible organic clothing.
The new brand launch happened recently, with a one-hour show exclusively on QVC and on QVC website, while supporting ethical fashion inclusivity, with sizes ranging from XXS-3X. As 68 per cent of American women are a size 14 or above, Seed to Style will provide a wider mainstream audience with the option to #dressorganically, with no compromise in value OR values, according to Ecofashion.
The new Seed to Style GOTS (Global Organic Textile Standard) certified organic apparel brand first and foremost focuses on fabulous fashion, from cozy knit cardigans and cropped poncho sweaters, to uber soft jersey tops and ombre lounge sets, to printed sweatshirt dresses and pullover hoodies, to twill utility pants, shirts and more.
Seed to Style promises to excite and delight even the most discerning fashionistas with its timely must-have styles, including its special long-sleeve organic jersey top with thumbholes in six stunning colours and prints, which QVC is featuring as , 24-hour on-air ‘Big Deal’, Ecofashion said.
With a deep passion and commitment to both climate action and social justice, the Seed to Style family is driven to elevate all who touch their products, on every level. From natural disasters to the global COVID pandemic, we are all longing for a new chapter, a rebirth of humanity, built on the realisation that we are all a part of a shared, collective ecosystem, together.
“QVC’s long-standing commitment to doing business the right way includes protecting the environment and championing a more sustainable way to retail.
When Zaroff and her team came to us with the idea of an all-organic apparel line, we jumped at the opportunity.
Seed to Style brings to life our shared commitment to both style and sustainability and we’re proud to share it with our customer,” Rachel Ungaro, GMM and VP of apparel for QVC and HSN said.
Source: Fibre2Fashion
EDANA, the leading trade association serving the nonwovens and related industries, has welcomed the Trade & Cooperation Agreement (TCA) signed in December 2020 between the European Union and the United Kingdom and, in particular, its specific rules of origin for nonwovens.
The most recent available figures cover 2019, when the UK exported nonwoven roll goods worth €96 million to the EU, while export traffic in the other direction reached a value of €280 million. The UK remains the second biggest trade partner for EU local manufacturers after the US.
Jacques Prigneaux, EDANA’s Market Analysis and Economic Affairs Director, commented: “This trade agreement not only guarantees that nonwoven roll goods will be able to continue to travel between EU member states and UK without customs duties, but also recognizes that a nonwoven process is sufficient to confer the origin on the product.”
“In order to qualify for the zero preferential tariff under the EU-UK Trade and Cooperation Agreement, products classified in HS 5603 must originate in the EU or the United Kingdom. According to the specific rule for nonwovens, devised and promoted by EDANA, and included in the TCA, any nonwovens produced locally will be considered as originating in the EU or United Kingdom, even if it has been produced using non-originating materials.”
“Obviously, EDANA member companies can contact me and I will be pleased to guide them through the procedure to claim a preferential import tariff,” Jacques Prigneaux added.
Pierre Wiertz, General Manager of EDANA said: “In this news, I see two key achievements and subjects of satisfaction for nonwoven producers whom we value as the core of EDANA’s membership.
On one hand, the ability for all of them to keep doing ‘business as usual’, or even expand trade opportunities, whether they trade from the EU or the UK, and on the other hand, the official recognition, hopefully once and for all, of the fact that manufacturing nonwoven roll goods is a substantial enough operation to confer origin status of the country where the resulting goods are obtained.
This latter event marks another step in the independence of the nonwovens industry from the traditional textile customs rules which too often unnecessarily constrained its development.”
Source: Innovation in Textiles
Dollar Industries Limited, an India-based leading garment & hosiery company, reported 22.3 per cent revenue growth to ₹312.44 crore in its third quarter (Q3) FY21 that ended on December 31, 2020, compared to the revenue of ₹255.4 crore in the same period previous fiscal. Company’s EBITDA for the quarter rose to ₹43.8 crore (Q3 FY20: ₹33.9 crore).
“The company crossed the mark of ₹300 crores of turnover this quarter. Also, this quarter the industry witnessed a sharp increase in prices of cotton and yarn starting November 2020. It will take a while before the prices stabilise for yarn,” Vinod Kumar Gupta, managing director, Dollar Industries Limited, said in a press release.
Profit after tax (PAT) during Q3 FY21 was ₹28.3 crore (₹19.5 crore). Operating revenue for the quarter increased to ₹311.7 crore (₹254.8 crore).
“The company continues its journey of growth working on revamping the distribution channel and digitisation. We look forward to a bullish Q421,” Gupta said.
Source: Fibre2Fashion News
Bangladesh Cotton Association, Brazilian Cotton Growers Association, Brazilian Cotton Shippers Association, Brazilian Trade and Investment Agency, the Bangladesh embassy in Brazil and the Embassy of Brazil in Dhaka jointly held a virtual meeting on Thursday.
Bangladesh’s foreign state minister Shahriar Alam and Brazil’s agriculture minister Tereza Cristina, Brazil embassy officers and Bangladesh embassy in Brazil officers took part in the meeting, said a press release.
They discussed the potentials and the challenges of importing of Brazilian cotton to be used in the textile industry of Bangladesh. Bangladesh Cotton Association’s former president Mohammad Aiub represented Bangladesh in the meeting.
Source: New Age Bangladesh
Record US holiday season retail sales during the last two months of 2020 reflected the recovering economy but also got a boost from consumer emotions after a stressful year, according to National Retail Federation (NRF) chief economist Jack Kleinhenz, who recently said there was a ‘push and pull’ between holiday excitement and worries over a resurgence in COVID-19 cases.
Kleinhenz’s remarks came in the February issue of NRF’s Monthly Economic Review, which said 2020’s $789.4 billion in holiday spending during November and December was the highest on record despite the coronavirus pandemic.
But consumers’ ability to spend was boosted by government stimulus checks received earlier in the year and money saved by not traveling, dining out or attending entertainment events, NRF said in a press release.
Rising home values and stock prices also provided support for holiday spending while the availability of COVID-19 vaccines helped ease worries over the virus and state restrictions on activity. Nonetheless, millions of Americans remained out of work and others were working fewer hours, NRF said.
“Household emotions likely played into holiday economic decisions as consumers wanting to offset the anxiety and stress experienced during 2020 spent on gifts to enjoy a better-than-normal holiday,” Kleinhenz said. “This was clearly a year when animal spirits outweighed conventional wisdom.”
The season’s 8.3 per cent growth over the same period a year earlier was the highest holiday growth rate in records going back to 2002—beating since 6.8 per cent in 2004—and more than double the 3.5 per cent average of the previous five years, including 2019’s 4 per cent gain.
The results easily exceeded NRF’s holiday forecast, which cited economic indicators such as growing employment and wages to predict that holiday sales would increase between 3.6 percent and 5.2 percent over 2019 to between $755.3 billion and $766.7 billion. The numbers exclude automobile dealers, gasoline stations and restaurants to focus on core retail.
The holiday spending total includes online and other non-store sales, which were up 23.9 per cent at $209 billion as consumers shopped more online whether they made their purchases from pureplay online sellers or traditional retailers’ websites. That compared with 14.7 per cent growth in 2019 and represented 26.5 per cent of total sales during the holiday season.
Kleinhenz called online holiday sales ‘a standout’ that showed how retailers had innovated during the pandemic. Even as it became too late for reliable delivery of online orders in late December, many consumers still ordered online but took advantage of in-store and curbside pickup services retailers had perfected over the previous several months.
Source: Fibre2Fashion News
The US African Growth and Opportunity Act (AGOA) is a key driver for boosting the textile-garment industry in Africa as it allows 39 sub-Saharan African nations to export goods, which includes textiles and garments, to the United States free of duty. Countries like Kenya and Ethiopia are turning garment manufacturing hubs in the continent, followed by Rwanda, Uganda and Tanzania to a great extent.
Kenya led the East African Community (EAC) members in its use of the AGOA, scoring 98 per cent. However, it came second to Ghana which recorded 99.1 per cent with Madagascar coming third at 93.7 per cent.
According to US government data, Ethiopia at 81.9 per cent and the Democratic Republic of Congo (DRC) at 68.2 per cent are the other east African countries that have also taken advantage of the treaty to increase exports to the United States, mainly of products like textile and apparels, metals, agricultural products and artefacts.
Kenya, Tanzania and Rwanda are the only EAC countries that have complete AGOA utilisation strategies in certain industries, including textile, apparel and handicrafts.
As African countries gradually shift to ratify the African Continental Free Trade Area (AfCTA), merging the continent's markets into a single market of more than 1.2 billion people and a GDP of over $2.5 trillion will be a challenge.
With 21 members, a population of around 560 million and a combined GDP of $769 billion, the Common Market for Eastern and Southern Africa (COMESA) is one of Africa's biggest regional economic communities and has made significant progress in many areas of integration.
Growth of trade among COMESA members, however, remains low compared to the region's trade with the rest of the world, both in exports and imports.
Millions of dollars have been invested in east Africa's garment industry. The number of nations growing genetically-modified (GM) cotton in Africa has doubled since 2018. Ethiopia, Kenya, Malawi and Nigeria have joined South Africa, Sudan and Eswatini in adopting GM crops.
The Parsons School of Design in New York is working with the African Development Bank (AfDB) to leverage digital tools to support the African textile and fashion industry.
The goal of the bank's Fashionomics Africa initiative is to enable African entrepreneurs operating in the textile, apparel and accessories industry to create and grow their businesses. It aims to create jobs, stimulate regional integration, intra-African trade and entrepreneurship development.
Through the Fashionomics Africa Digital Marketplace-which targets Cote d'Ivoire, Nigeria, Kenya, Ethiopia and South Africa-and mobile app, the bank is also analysing the impact of the textile sector on climate change and environment to deploy climate-friendly solutions.
German fashion house Hugo Boss in November launched a sustainable collection in support of Cotton made in Africa (CmiA), an internationally recognised standard for sustainably-produced cotton from the continent.
Sales of Moroccan textiles and clothing in the EU and US import markets were down sharply during the first half of 2020 as was production by Tunisian textile, clothing and fur manufacturers.
The textile and apparel industry in Africa has grown rapidly in the past couple of years, and is estimated to grow at a compounded annual growth rate of around 5 per cent over the next five years. Even faster growth is possible if the countries pay attention to grey areas like infrastructure, strategic supply chain and skill management.
Source: Fibre2Fashion News
Britain’s £35billion fashion and textile industry is confronting devastation as a consequence of red tape and travel restrictions erected by the new post-Brexit trade agreement with the European Union. Recently over 400 foremost fashion figures have written a letter to caution Prime Minister Boris Johnson that Brexit was upsetting complex international supply chains of the fashion industry.
“The deal done with the EU has [left] a gaping hole where promised free movement for goods and services for all creatives, including the fashion and textiles sector. Yet we have been disregarded in this deal and our concerns overlooked,” fashion experts say in the letter to Boris Johnson.
Adding, “without urgent attention these issues will jeopardise the immediate and long term future of the sector”.
Designer Katharine Hamnett said, “Many firms could be weeks away from going under. We need a radical overhaul of customs arrangements including VAT on all goods shipped into the EU by the end of February, or British brands will die.”
While Isabel Ettedgui, Chief Executive of fashion brand Connolly said, “The trade rules were turning the industry into a Brexit trading post.”
“The result could be the possible closure of a 185-year-old company that holds the Royal Warrant,” Ettedgui added.
Several of the 52,000 smaller companies that make up the spine of the UK’s fashion industry, could not have enough money the professional aid needed to steer the new controls, the letter added, with consumers on both sides of the English Channel refusing purchases because of unexpected VAT and tariff charges.
While fashion designer Katharine Hamnett said, “We need a radical overhaul of customs arrangements including VAT on all goods shipped into the EU by the end of February, or British brands will die.”
Helen Brocklebank, Chief Executive, Walpole said, “The luxury sector group whose members include Alexander McQueen and Burberry, said the government needed to simplify the post-Brexit trading regime and boost the retail tourist trade.”
While the UK govt. spokesperson said, “We are working closely with businesses in the fashion industry to ensure they get the support they need to trade effectively with Europe, and seize new opportunities as we strike trade deals with the world’s fastest growing markets.”
More than 400 signatories call for ‘urgent action’ from the govt. to protect the fashion industry that is very split but is projected to be worth 1.6% of UK’s GDP, according to research by Oxford Economics for the British Fashion Council last year. By contrast the German industry is worth 0.8% of GDP.
The UK Cabinet Office said it was working carefully with businesses in the fashion industry to regulate to the new trading environment and was responsive that some businesses were facing challenges.
Source: Textile Today
The European Union wants to make sustainability a market norm. Following the already adopted "Circular Economy Action Plan", clear legal requirements for the textile industry are to follow by the end of the year. Best practice examples from the sports sector already exist.
"Business as usal will no longer work!". Katrin Ley summed up the core message right at the beginning of the top-class panel discussion on the topic of "Circularity" at ISPO Munich Online. With the sustainability and innovation platform Fashion for Good, the managing director exemplifies the necessary change in the sports and textile industry.
After all, the EU is now also putting legal pressure on the circular economy. "Sustainable products and circular economy are to become the market norm.
That is the clear goal by the end of this decade and we want to be a role model for the whole world with it," Helena Braun announced during the discussion. She is a member of the team of EU Commissioner Franz Timmermans, who is responsible for the European Green Deal in the cabinet of President Ursula von der Leyen.
Legal requirements for textile industry planned And changes in ecology and sustainability are high on the EU's list of priorities. Following the adoption last year of the "EU Circular Economy Action Plan adopted last year, there are to be clear guidelines by the end of this year for the textile sector, which has so far been centrally classified because of its less sustainable production methods.
"We want to change how products are consumed and produced. They should become recyclable, repairable and more durable," said Braun. In addition, new business models such as product as a service should be supported.
Similar legal regulations had been enacted for the plastics industry during the last legislative period. Due to the ongoing discussion process, Helena Braun was not yet able to give many details about the planned regulations in the textile sector.
But some things are already on the horizon: "A compulsory percentage of sustainable products could be introduced. In addition, we want to ensure that the market for recycled textiles functions across countries in the EU and that companies also have reliable access to it." So far, only one percent of textiles are recycled, the rest end up in the garbage.
EU invites sports and textiles industry to cooperate
Braun invited all players in the sports and textile industry to participate in the ongoing legislative process: "Everyone can contribute. It's not about restrictions, but the measures should bring a benefit for the people and the industry." The EU-supported "New Cotton Project" shows how this can work in a meaningful way.
In it, numerous major brands, organizations and universities from Europe are working together to produce commercial clothing completely in a circular model for the first time worldwide.
In concrete terms, this means that the Finnish biotechnology company Infinited Fiber Company collects textile waste, processes it and produces new fibers from it. These are then processed into commercial clothing by large companies such as H&M or adidas. At the end of the use phase, the clothes can be returned and the process starts all over again.
"This fits into our corporate goal of making a difference for people and changing their lives. The motto is Made to Remade," said James Tarrier, Director Platform Innovation at Adidas Futures Team, explaining the brand's participation in the pioneering project.
Circular economy to become mainstream
Fashion for Good supports exactly such actions by bringing disruptive, innovative startups together with big brands. So that such circular processes reach the mainstream.
"So far, the process is mostly linear. Clothes are produced using a lot of resources and then end up in the trash at some point. That has to change," Ley demanded: "For that we need innovation, cooperation along the whole supply chain and the support of politics."
Only in this way can sustainability and the circular economy eventually become "business as usual".
Source: Ispo.com
Weeks after the formal Brexit agreement, India has revived dialogues with the EU and launched talks with the UK in a bid to expedite trade deals and aid economic growth in the post-Covid era.
In a virtual meeting with EU trade commissioner Valdis Dombrovskis on February 5, commerce and industry minister Piyush Goyal pitched for a quick “early-harvest deal” followed by a time-bound and balanced free trade agreement (FTA), formal negotiations for which have been stuck over differences since 2013.
The EU, including the UK, was India’s largest export destination last fiscal, with a 17% share in the country’s overall outbound shipments.
Goyal also sought the EU’s endorsement of a joint proposal moved by India and South Africa at the WTO, to get a temporary waiver of the restrictive TRIPS agreement to ensure adequate supply of Covid-19 vaccines in developing countries.
Separately, Goyal held talks with Britain’s international trade secretary Liz Truss, who was on a visit to India last week, to boost trade.
The renewed thrust on trade talks after the Covid disruptions reinforces India’s commitment towards greater integration with the global value chain, just as it maintains that its Atmanirbhar initiative is not inward-looking.
Having pulled out of the China-dominated RCEP deal, India has been seeking to expedite trade talks with large markets.
Importantly, both India and the EU sides have now agreed to review the progress of discussions on the proposed bilateral trade and investment agreement on a monthly basis by senior officials. It will be followed by a quarterly review by both Goyal and Dombrovskis.
Both have also decided to meet within the next three months before the India-EU Leaders’ Summit (to be attended by Prime Minister Narendra Modi, among others) is held at Porto on May 8.
The dialogues come at a time when India’s planned FTA with the EU has lost some of its sheen, thanks to Brexit. For instance, Britain made up for 26% of India’s apparel exports in FY20 to the EU, which was the largest export destination for Indian apparel with a 37% share. Hence, trade deals with both the EU and the UK are crucial.
The UK accounted for 16% of India’s $53.7-billion exports to the EU in FY20. Apart from garments, India ships out gem and jewellery, pharma products, footwear and organic chemicals, among others, to the UK in large volumes.
Importantly, Indian exporters have flagged that any India-UK trade talks won’t have the same level of complication that exists between India and the EU, and a deal can be firmed up without much hiccups.
After 16 rounds of talks between 2007 and 2013, negotiations for an India-EU FTA were stuck due to differences, as the bloc insisted that India cut import duties on automobiles and wine (which would benefit mainly Germany and France), among others.
The UK is unlikely to be much too rigid over these issues, analysts reckon.
As for the current talks with the EU, a senior government official said: “The objective is to take forward any of the possible deliverables in the upcoming Leaders’ Summit.” The likely deliverables include launching an investment facilitation mechanism, working on regulatory cooperation, removing trade barriers, deepening research and promoting innovation, addressing multilateral issues of mutual interest, continuing dialogue on the intellectual property rights and building resilient value chains.
Source: The Financial Express
Bangladesh has regained its positive export growth in the RMG sector after unexpected negative growth due to coronavirus. Bangladesh is still the world’s second-largest garment exporter. But when it comes to raw materials, the country is largely dependent on foreign countries.
Also, Bangladesh still has to compete with lower production costs due to backward connection dependence. Bangladesh is the fifth largest textile importer in the world with a 3.10 percent share in the global textile import market. A competitive analysis shows that the overall business structure of the textile and RMG sector in Bangladesh is unstable.
Spinning industry
Yarn is the root of all textiles. BTMA has 450 spinning mills members. During April-October, yarn exports increased by 48 percent in Bangladesh. However, Bangladesh has lagged in demand. The total production of cotton in Bangladesh is 29.4 MT against the requirement of 1613.3 MT.
Textile traders say that India is the biggest competitor of Bangladesh’s textile yarn and other countries including China, India, and Pakistan. Due to the lockdown, the import of yarn and fabric from abroad has come down drastically. So it has been relatively easy to turn around even during Corona’s difficult times.
BTMA President Mohammad Ali said, “The textile sector has turned out very well. Although the purchase order has slowed down this November, the news of the vaccine has changed the tone of the buyers.
Purchasing orders have picked up again, adding that Corona has started pushing for better orders from August. It continues in September, October, and November. At present, there is no stock of yarn and cloth in the warehouses of export-oriented textile mills. Although there are some stocks produced for the domestic market, it is due to the change of seasons.
Bangladesh has enough spinning capacity with 257 spinning rotor machines, 11650 spindles short-staple spinning machine in (000′ units). But in long-staple spindle spinning machines, Bangladesh has only 15 (000′ units).
|
Parameters |
China |
India |
Bangladesh |
Vietnam |
Turkey |
|
Cotton Production (1000 MT) |
6041.8 |
6422.9 |
29.4 |
0.7 |
892.7 |
|
Cotton Consumption (1000 MT) |
8600.1 |
5388.7 |
1613.3 |
1633.0 |
1480.5 |
|
Harvested Area (1000 Hectares) |
3450 |
12700 |
44 |
1 |
560 |
|
Spinning Machines- Rotors (‘000 unit) |
2850 |
878 |
257 |
132 |
800 |
|
Spinning Machines- Spindles Long Staple (‘000 unit) |
3623 |
991.2 |
15 |
2 |
757.4 |
|
Spinning Machines- Spindles Short Staple Unit |
1,00,000 |
52537.8 |
11650 |
6950 |
7900 |
The main shortcomings of the spinning industry in Bangladesh are its cotton consumption and harvesting areas are better than Vietnam but lag far behind China and India.
Fabric industry
There are 650 weaving and 160 dyeing and finishing factories that are members of BTMA. From April to October, fabric worth Tk 6407 crore were exported with an increment of 3.62%.
Despite these exports, Bangladesh cannot meet its own needs. According to the latest figures from the World Trade Organization (WTO), Bangladesh imported US$ 9.91 billion worth of textiles in 2019, up from $11.0 billion in 2018. BTMA are providing 80-85 percent of the yarn required for knitwear and 35-40 percent of the required fabric for woven garments.
Mohammad Ali Khokon, President of the Bangladesh Textile Mills Association (BTMA), said, “Since we cannot meet the full demand, China and India can fill this gap,” adding that we need to build 20 more textile mills. Local garment exporters will be able to supply quality fabrics. ”
Bangladesh has more capacity in shuttleless looms than India and Vietnam. However, Bangladesh needs to do more in shuttle weaving.
|
Parameters |
China |
India |
Bangladesh |
Vietnam |
Turkey |
|
Weaving machines –Shuttle Looms (‘000 units) |
345 |
45.5 |
17.2 |
15 |
20 |
|
Weaving machines –Shuttle-less Looms (‘000 units) |
835 |
22.8 |
33.8 |
6.8 |
49.5 |
RMG industry
Bangladesh’s ready-made garments (RMG) returned to negative territory in October after a 44.63 percent year-on-year growth in exports. Exporters say falling commodity prices have also hurt the industry in the face of rising production costs. However, after a decline in the previous month of October, the country’s merchandise shipments again in November this year showed a positive trend with low growth.
The main reason for the change in exports is uncertainty.
“Of course we are worried – we need to monitor the situation carefully,” said Rubana Huq, President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), a lobby of garment exporters.
This situation is due to the second wave of coronavirus infection hitting America and Europe.
Approximately 81.20% of the total exports come from the garment sector which is the top in the world. Bangladesh can fight enough against the competitors with a lead time of 60-70 days. Also, Bangladesh has the second largest number of garment workers in the world.
|
Parameters |
China |
India |
Bangladesh |
Vietnam |
Turkey |
|
Share in Textile in Total Exports |
10.40% |
11.20% |
81.20% |
15% |
16.30 |
|
Lead Time (Days) |
30-60 |
90-120 |
60-80 |
90-100 |
60 |
|
Labor Force (Textile & Apparel Industry) (million) |
10 |
2.8 |
4.5 |
2.5 |
0.8 |
Moreover, Bangladesh needs evolution, not a revolution in the textile and RMG industry. The Bangladesh RMG sector still needs to improve its lead time and product quality. The Bangladesh textile industry has considerable potential to back up the RMG sector.
In addition to saving huge imports, the country also needs to develop the RMG sector-related backward linkage industries to create more employment opportunities for further development.
BTMA can meet the demand for 100% backward linkage for the RMG sector by investing TK 10,000 crore to build 20 new textile mills. The total investment in the textile sector is about $0.8 billion (2020) while the total investment in India and China is $1.2 billion (2020) and $6.5 billion (2018).
Source: Textile Today
The world’s largest apparel importer USA has nosedived significantly in its apparel imports during 2020 – both value-wise and volume-wise, according to OTEXA.
USA imported 23,132.80 million SME of apparels in 2020 valuing US $ 64.07 billion and noted a downfall of 16.37 per cent and 23.46 per cent, respectively.
All top shippers fell down in their respective exports to USA owing to pandemic outbreak. As far as volume-wise import of USA is concerned, China Indonesia and India fell in double digits, while Vietnam and Bangladesh declined in single digits.
What’s noteworthy is that Cambodia grew both in volumes and values in its apparel shipment to USA in 2020 over 2019. In volume terms, Cambodia even surpassed Indonesia and India to climb to the 4th spot after China, Vietnam and Bangladesh from 6th rank in 2019 tally.
Below tables contain the complete details –
Y-o-Y % Change in Volume-wise Apparel Exports to USA from Top 10 Countries:
(Comparison between 2019 and 2020) (Qty in million SME)
|
Countries |
2019 |
2020 |
% Change |
|
World |
27,660.75 |
23,132.80 |
(-) 16.37 |
|
China |
11,049.94 |
8,466.40 |
(-) 23.38 |
|
Vietnam |
3,947.56 |
3,787.71 |
(-) 4.05 |
|
Bangladesh |
2,009.79 |
1,889.63 |
(-) 5.98 |
|
Cambodia |
1,042.88 |
1,127.38 |
8.10 |
|
Indonesia |
1,129.18 |
922.12 |
(-) 18.34 |
|
India |
1,118.56 |
904.73 |
(-) 19.12 |
|
Honduras |
1,004.40 |
681.19 |
(-) 32.18 |
|
Mexico |
789 |
679.95 |
(-) 13.82 |
|
Pakistan |
598.51 |
630.91 |
5.42 |
|
El Salvador |
745.16 |
492.03 |
(-) 33.97 |
Y-o-Y % Change in Value-wise Apparel Exports to USA from Top 10 Countries:
(Comparison between 2019 and 2020) (Values in US $ million)
|
Countries |
2019 |
2020 |
% Change |
|
World |
83,704.74 |
64,070.48 |
(-) 23.46 |
|
China |
24,911.09 |
15,154.79 |
(-) 39.16 |
|
Vietnam |
13,552.22 |
12,570.07 |
(-) 7.25 |
|
Bangladesh |
5,924.32 |
5,229.16 |
(-) 11.73 |
|
Indonesia |
4,398.90 |
3,514.98 |
(-) 20.09 |
|
India |
4,058.36 |
3,020.07 |
(-) 25.58 |
|
Cambodia |
2,677.79 |
2,823.80 |
5.45 |
|
Mexico |
3,124.43 |
2,203.19 |
(-) 29.49 |
|
Honduras |
2,792.86 |
1,826.46 |
(-) 34.60 |
|
Jordan |
1,781.19 |
1,527.33 |
(-) 14.25 |
|
Sri Lanka |
1,796.37 |
1,463.23 |
(-) 18.55 |
Source: Apparel Online
